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Among countless US citizens, the economy over the past five years has been tough. Expenses have escalated while salaries remains stagnant. High mortgage rates have made purchasing property a dismal prospect. The jobless rate has been gradually increasing.

Many Americans have indicated they're postponing major life decisions, including having kids or switching jobs, because of economic uncertainty. But for a select few of people, the recent half-decade couldn't have been more successful.

Fortune Expansion

The wealth of the world's billionaires increased 54% in 2020, at the height of the pandemic. And even throughout all the financial uncertainty, the stock market has only continued to grow. This increase has primarily advantaged just a limited group of Americans: 10% of the population controls 93% of stock market wealth.

Despite the imbalance as this division seems, it's the financial structure working as it is presently configured.

"The wealthy have bought their jets, they've acquired their multiple houses and mansions, but now they're securing senators and media outlets," explained economic inequality analyst Chuck Collins. "We're now entering this other chapter of extreme wealth extraction where the wealthy are preying on the system of inequality."

Mapping Economic Classes

To help others grasp what exactly it means to be "rich" in the US, Collins borrows a concept from journalist Robert Frank who, in a 2007 book on the rich, conceptualized the different levels of wealth as "Affluencia" villages: Wealth Borough, Lower Richistan, Middle Richistan, Upper Richistan and Billionaireville.

To modernize the concept, Collins categorizes these "wealth villages" based on income levels:

• At the base level, Affluent Town, are the 10 million Americans who have a annual salary of at least $110,000 and an net worth of over $1.5m.
• The villages get more select as wealth goes up: Lower Richistan has 2.6 million households who have wealth between $6m and $13m.
• Middle Richistan has 1.3 million households who have assets worth an average of $37m.
• Upper Richistan, made up of 130,000 Americans (roughly the size of a small city) has between $60m to $1bn in wealth.

Collectively, the residents of these villages constitute the top 10% of the wealth income distribution, about 14 million Americans altogether, though their circumstances vary dramatically.

"You could be in Lower Richistan, and you're still traveling in the coach section of a commercial plane," Collins explained. "Whereas in Upper Richistan, you're traveling via a private jet. That's a really distinct lifestyle. You fly private, you have no investment in the commercial aviation system. You don't care if the whole system collapses – you're set."

Extreme Affluence Consequences

The highest hill in "Richistan" is Billionaireville, which is made up of about 800 American billionaires who are some of the world's wealthiest. The power that this group has substantially outweighs those who are simply well-off, let alone the typical citizen who doesn't live in "Richistan" at all.

But Collins thinks the progressive slogan "billionaires shouldn't exist" doesn't capture the real problem and has a "hint of elimination" to it.

"It's the distinction between personal actions and a structure of regulations," Collins said. "We should be worried about an economic system that channels so much wealth upward to the billionaires."

The Four Pillars of Billionaire Wealth

To understand how wealth at the billionaire level works, Collins separates it into four parts: getting the wealth, securing fortune, political capture and extreme wealth removal.

When many Americans think about wealth, they usually think exclusively about the first step, Collins said. People can create a modest amount of wealth through creating or operating a successful business, which could get them admission in Affluent Town.

But getting to Billionaireville requires serious investment and strategy in those next three steps. Collins describes what he calls the "wealth defense industry": the tax lawyers, accountants and wealth managers who use their skills to ensure that the super rich are being deliberate about their taxes.

"Wealth defense professionals use a broad range of tools such as legal entities, foreign deposits, anonymous shell companies, philanthropic entities and other vehicles to hold assets," he explains.

Political Influence and Hyper-Extraction

To advance a wealth defense strategy, a family needs government backing. Wealth of over $40m converts to political power, Collins says, and can be used to secure fortune and ensure continued growth.

The last stage is a different kind of wealth accumulation, one that Collins calls "extreme removal" to describe how the wealthy have come to touch nearly every single part of an Americans' routine activities largely through private equity, which allows wealthy individuals to support private companies.

"Private equity is looking for those areas of the economy where they can increase profits a little bit harder," Collins said. "One thing I don't think people realize is these billionaire private-equity funds are what happens when so much wealth is parked in so few hands, and they can basically shift and say, 'Where else can we extract profits out of the economy?' Healthcare? Great. Mobile home parks? These people can't go anywhere, [so] you can raise their rents."

The Real Consequences

The results of this inequality go beyond the wealth getting wealthier. It's about people paying more for their healthcare, rent and vet bills without seeing any substantial income improvement. And Collins said the hardship and discontent of this kind of society can lead to deep discontent.

"The most powerful wealthy elites understand people are being left behind [and] are economically suffering," Collins said, adding that right-leaning leaders have been good at connecting with a potent "phony populism".

Government Truth

The paradox, Collins points out in his book, is that elected representatives have appointed a series of billionaires to cabinet positions. Along with wealthy entrepreneurs who had brief but powerful roles overseeing massive cuts to the federal workforce, other crucial appointments for commerce, treasury, education and the interior are also all billionaires.

This political landscape, along with help from legislative supporters, helped pass major tax legislation, which will make enduring decreases for the wealthy and corporations.

The Path Forward

While political parties continue to argue that immigration and unfavorable commercial treaties are the source of everyone's economic problems, "the question becomes: Will the alternative political group, which has also been captured by the billionaires and big money, be able to seriously confront the underlying harms?" Collins said.

Progressive politicians, he argues, know what policies are needed to "alter economic flow", including substantial modifications to the tax system, raising the minimum wage and supporting labor organizations.

"It was so, so close, and the legislation really did embody the will of the most of people who really want lawmakers to fix some of these critical challenges," Collins said. "Wealthy influence is not about developing so much as stopping. It's easier to block than it is to make something substantial take place, but the historical precedent is there. We know what that looks like."

Collins is hopeful that there can be change, but said it would require ongoing legislative effort.

"It may be quickly that the tide turns, and then it really is about preserving a continuous public campaign to make progress on this extreme inequality we're living in," he said. "We can fix this. It is addressable."